Friday, February 11, 2011

Revenues fall, need for cuts rises

Legislature won’t consider revenue increase, lawmakers say


An American flag that flies high above the Forest Service’s Ketchum Ranger Station could be joined by another if state Sen. Michelle Stennett’s first sponsored legislation is made law. Photo by David N. Seelig

Despite state tax revenues' exceeding projections by $10 million for December, the Legislature is still seeking ways to close a $135 million gap for fiscal year 2011.

"We're on an upward trend," said Rep. Wendy Jaquet, D-Ketchum. "We've got about 10 million over, which is great."

Jaquet predicted a revenue drop in February, though, leaving the Legislature with significant shortfall for 2011 that must be closed even as lawmakers attempt to set a fiscally sound budget for 2012.

"No one goes shopping in January," she said. "February won't be good."

Tightening the purse strings

Local lawmakers say the gap would likely prompt cuts rather than attempts to increase the state's incoming funds.

State Sen. Michelle Stennett and Rep. Wendy Jaquet, both D-Ketchum, say they would prefer the state consider measures that would increase revenues, but they believe the legislative majority is more likely to continue to slash department budgets.

One such cut is an increased blow to the Department of Health and Welfare. Jaquet said that could reach $40 million, but the move would also result in the loss of federal matching funds, meaning the department would lose closer to $100 million.

"That's a tremendous chunk not to receive," Stennett said. "I don't know how or why we'd want to walk away from something like that."

Both Jaquet and Stennett said the Legislature would likely shut out any attempt, no matter how noncontroversial, to bring additional revenue to the state.

As an example, Jaquet pointed to the House's recent rejection of a bill that would have raised $386,000 for state peace officer training. She said the bill failed because it would have raised a court fee by $1.50. The fee currently stands at $10 and is levied on any person found guilty of a felony, misdemeanor or minor traffic or other violations.

Jaquet said there has been debate in the Legislature regarding suspending the grocery tax exemption that provides Idahoans with a limited reimbursement of sales tax on food each year. Cutting the exemption would bring the state $184 million.

Another sales tax exemption cut floated by Rep. Shirley Ringo, R-Moscow, would bring $371 million to the state while lowering the overall sales tax rate from 6 percent to 5 percent.

If approved, the bill would raise funds by levying the sales tax on ski lifts and snow grooming equipment, utility sales and services such as construction, transportation and sales by guides and outfitters, among others.

The bill has been in the House Revenue and Taxation Committee since Jan. 21 and Jaquet said it would likely continue to languish.

"It's not going to get a hearing," she said. "There's no appetite to look at exemptions here."

However, she said, soon the legislature may have no choice but to stop slashing and start looking elsewhere for funding.

"At some point, we're going to have to consider additional revenues," she said.

The Joint Finance-Appropriations Committee is set to begin the budget-setting process on Monday, Feb. 21.

Flying the flag

A bill that addresses protocol for flying a flag commemorating prisoners of war will go before the Senate State Affairs Committee today.

The bill, Stennett's first sponsored piece of legislation, would allow government buildings to fly flags paying tribute to prisoners of war and soldiers missing in action along with the American flag.

Before this session started, Stennett stated her intention not to co-sponsor or sponsor any legislation, but she said she had changed her mind.

"I was handed a couple of bills from the veterans in Gooding, and they wanted to the ability to fly the flag in front of government or public buildings," she said.

Though flying a flag is not prohibited by state statute, it is not specifically allowed, and Stennett said the veterans wanted a set of specific regulations.

"They felt strongly enough to have it in the books, and it would allow Hailey to fly the flag if they wanted to, in honor of Bowe and his family," she said, referring to Army Spc. Bowe Bergdahl, a Hailey-area native captured while serving in Afghanistan in 2009.

If approved, the bill will go to the Senate floor for a vote. If it passes the Senate, it must then be voted on by the House before it becomes law.

Stennett said she also plans to sponsor an end-of-life bill in the next week. The bill would rescind a law passed last year that allows physicians and other medical professionals to refuse treatment or ignore living wills if it goes against their beliefs.

"It allows the physician to have a say in a very personal matter," Stennett said, adding that she felt "very strongly" that the law needed to be scaled back.

Stennett said she is launching the bill because a House counterpart has been in committee since Jan. 21 without being scheduled for a hearing.

Katherine Wutz: kwutz@mtexpress.com




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